Oil executive urges use of alternative fuel at business-school luncheon

ASU alumnus and Shell Vice President Curtis Frasier spoke about sustainability and renewable energy at a luncheon held Thursday by the Economic Club of Phoenix, an ASU organization. (Madeline Pado/DD)

An ongoing goal of oil companies is to replicate the efficiency of the human cell, but scenes in documentaries like Gasland that show the purported dangers of shale-gas production “make for sensational movies and television,” an authority from Shell Oil Co. said at a luncheon Thursday.

The Economic Club of Phoenix, an ASU W.P. Carey School of Business organization, converged on downtown Phoenix late Thursday morning to host its monthly luncheon in the Sheraton Phoenix Downtown’s Ballroom. After a few brief welcomes and introductions, the attendees were served lunch, followed by a presentation by ASU alumnus Curtis Frasier.

Frasier is the executive vice president and general counsel of Shell Oil Co. in the United States and Royal Dutch Shell’s Upstream businesses throughout the Americas. He opened the talk with an summary of the world’s energy system through the eyes of Shell, noting that no one yet knows the model of sustainability in the future. The latest studies, Frasier said, show the year 2050 represents a tough goal.

“I really do think that the health and the security and the sustainability of the planet that our kids are going to live on and share with 9 billion people by 2050 requires all of us right now to come up with some very smart answers to some very tough questions,” Frasier said. “So it’s all on you now.”

He explained that with today’s market demands, Shell puts fuel in an airplane every 12 seconds each day. People hardly notice the 22 million tons of Shell chemical products that goes into everyday plastic products from computers to carpet and detergent to tabletops, Frasier said.

He explained the infrastructure Shell uses to pull oil from the ground, including a 55,000-ton metal cork the size of the Eiffel Tower that sits in the Gulf of Mexico, housing over 100 oil workers and drawing oil from two miles below the surface of the water.

“The oil and gas we produce, you know, is not renewable. So when you produce it and use it, it’s gone, and you are in a constant race to replenish it,” Frasier said. “This is what drives the value of oil companies.”

Energy demand for 9 billion people in 2050, Frasier said, is going to double.

“The easy oil is gone,” he said, “so where we’re looking for oil is in more and more difficult places.”

Shell spends about 30 billion dollars every year to keep up with and maintain the growth of its industry, Frasier said. But the oil that Shell produces in the world markets amounts to a mere 3% of the oil industry, Frasier said. The oil business, he said, is a blend of technology 100 years old with the technology of the new, sustainable practices that no one dreamed were possible even five years ago, and it is more of a space race because of the elaborate technology involved.

“If you can compare that system in its complexity and ingenuity to the human cell, then you lose big time,” Frasier said. “Here’s the perfect energy plant that nature’s created: It’s one-tenth the diameter of a human hair, but it takes amino acids and proteins and oxygen and through the cell’s cycle it creates energy with perfect efficiency and zero waste.”

The challenge, he said, is to use what nature has provided and take crude human steps to match that to technology today. But as it stands, energy today is extremely wasteful and needs to be more efficient. This includes changing the way we live our lives, Frasier said.

By the year 2050, according to the study Frasier mentioned, every three out of four people will live in a city. At that current rate of growth, we will be creating another metropolitan Tucson every week for 30 years, he said.

“Let’s face it. Who wants another Tucson?” he joked. “If that doesn’t convince you to throw your car keys into the swimming pool and start walking to work, then I don’t know what will.”

As an energy company, Shell strives to keep people informed about ways to use less fuel, Frasier said.

“We can use a lot less energy and still be in business when the day is done,” he said. “So what we want is to have society be more sustainable because we’d rather be in business where people can live and work than have high energy prices but no one is around to buy it.”

Shell has recently focused on shale-gas production. The price keeps dropping, with resources everywhere, Frasier said. The controversy, he said, comes from people’s concerns about the safety of fracturing shale to release the natural gas — a process sometimes referred to as fracking.

“If you’ve seen Gasland, or something, where they light the sink on fire, that reports to be from fracking, although it wasn’t,” Frasier said. “But it makes for sensational movies and television.”

But Shell, Frasier said, has taken numerous safety precautions when it comes to fracturing shale, including protecting the water supply. Another big step that Shell is striving for is to use less water in shale fracturing, since breaking through rocks in the Earth’s crust requires tons of water to reach the natural gas.

On the nanotechnology side of the company’s sustainability efforts, Shell is working with HP to develop seismic sensors “a thousand times more sensitive than a Wii video game,” Frasier said. This way, he said, they can be more informed about what’s going on under the surface of the Earth so as not to disrupt any seismically sensitive areas through drilling.

To any skeptics of oil companies striving for alternative energy, Frasier says it is necessary for the growing world.

“We’ve been saying for five years in places like this and on Capitol Hill that the question around energy in America isn’t ‘Which one?'” Frasier said. “It’s all of the above.”

Shell has an investment in biofuel in Brazil, wind energy in the Netherlands, hydrogen-energy development, solar energy, and many other sustainable ventures, Frasier said.

“We’ve got to continue to produce fossil fuels because that’s what we do and that’s what the world needs to keep our lifestyles engaged and keep creating jobs and keep doing what we do,” Frasier said. “But it doesn’t mean that we don’t work on those other things at the same time.”

Frasiercites past inconceivable innovations, such as drilling for oil in the ocean, as what will be needed to sustain the following generation.

“It’s going be big, it’s going be expensive, and we want to be right in the middle of it,” Frasier said.

After the speech, TJ Wead, a finance senior at the W.P. Carey School said he was especially interested in the new oil reserves being built and that it was the best luncheon he had ever been to. He has been to almost every one in the past two years.

As far as Frasier’s take on shale fracturing, Wead said “I think you have to do it in a responsible way, so I’d agree with what he said.”